Woman Sues MCM, Midland Funding After Error Caused Confusion, Injury to Credit

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Midland Credit Management, Inc. (MCM) and Midland Funding, LLC have been accused of attempting to collect on a debt they did not lawfully own and accessing a consumer’s credit report without authorization. In a proposed class action lawsuit, a Wisconsin woman claims she received two debt collection letters from the defendants indicating that they had purchased her alleged debt from her creditor and would report the debt to credit reporting agencies if she failed to make payments on it. According to the suit, about six months after receiving the first letter, the plaintiff received another letter from the defendants informing her that her account “was transferred in error” and had been “recalled” by her former creditor. The defendants allegedly indicated that they would notify the three major credit reporting agencies of the error and instruct them to delete the information concerning her account.

The suit claims that, first of all, the third letter “is facially unclear about what actually happened to [the plaintiff’s] account,” arguing that the unsophisticated consumer would be unsure as to what “transferred” and “recalled” meant and would not be able to determine who actually owned the debt.

Secondly, the complaint argues, if the defendants never actually owned the plaintiff’s account, they accessed her credit report without a “permissible purpose,” in violation of the Fair Credit Reporting Act (FCRA).

Lastly, the suit alleges violations of the federal Fair Debt Collection Practices Act and the Wisconsin Consumer Act, claiming the defendants’ letters were “false and misleading” and unlawfully threatened the plaintiff with adverse action.